R (Hottak) v Secretary of State for the Home Department

The claimants, Afghan nationals who had worked for Her Majesty's Government (HMG) in Afghanistan, challenged the Afghan Scheme under the Equality Act 2010 and the Public Sector Equality Duty. The primary legal question was the territorial reach of Part 5 (work: section 39(2)) and Part 3 (public functions: section 29(6)) of the Equality Act 2010 in respect of employees working exclusively abroad.

The court applied the connecting‑factors approach developed in Lawson v Serco, Duncombe and Ravat and held that locally engaged Afghan staff did not have the requisite stronger connection with Great Britain or British employment law: their contracts were governed by Afghan law, pay was in US dollars, they lived and worked in Afghanistan and lacked the strong enclave/English‑law factors necessary to bring them within section 39(2). For the same reasons it would be anomalous to treat Part 3 as having wider territorial effect and section 29(6) was not applicable to the claimants' circumstances.

The claim in common law failed as a Wednesbury challenge because the different schemes reflected material and relevant differences in country circumstances and risk. The court did find a limited breach of the Public Sector Equality Duty (section 149(1)(b) and (c)) in the formulation of the Afghan Scheme but, having regard to the post‑hoc equality analysis undertaken and the practical consequences of quashing the scheme, the appropriate remedy was a declaration rather than quashing or mandatory relief.

Background and issues:

• The claimants were Afghan nationals who had worked as interpreters for British forces. They challenged the Afghan Scheme (comprising the Intimidation Policy and the Ex Gratia/Redundancy Policy) under the Equality Act 2010 and under the Public Sector Equality Duty. They contended that they were unlawfully excluded from the more generous Iraq Scheme and that the Afghan Scheme discriminated on grounds of nationality or failed to discharge the PSED.

Nature of the application and relief sought:

• Judicial review of the Afghan Scheme: substantive discrimination claims under the Equality Act 2010 (section 39(2) re employees and section 29(6) re public functions), an alternative common law challenge, and a procedural claim for breach of the Public Sector Equality Duty (section 149(1)). Remedies sought included quashing orders and other relief.

Issues framed by the court:

1. Whether section 39(2) of the Equality Act 2010 (employment discrimination) applied to the claimants' employment in Afghanistan.
2. If not, whether section 29(6) (public functions) applied to the formulation and application of the Afghan Scheme.
3. Whether there was direct or indirect discrimination in the differential treatment between the Iraq and Afghan schemes.
4. Whether the defendants breached the Public Sector Equality Duty in formulating the Afghan Scheme.
5. Whether any common law obligation required like cases to be treated alike.

Court's reasoning and conclusions:

• The court analysed territorial reach by reference to the jurisprudence on section 94(1) of the Employment Rights Act 1996 (Lawson v Serco, Duncombe, Ravat). That approach asks whether the employment relationship has a stronger connection with Great Britain and British employment law than with the foreign country. The claimants' contracts were governed by Afghan law, paid in US dollars, subject to Afghan tax arrangements, and the claimants lived and worked in Afghanistan. They lacked the characteristics of an international/British enclave or other exceptional connecting factors. As a result, section 39(2) did not apply.
• The court rejected the argument that Part 3 (section 29(6)) could capture what Part 5 did not: it would be anomalous for Parliament to intend that employment matters outside Part 5's territorial reach nevertheless fall within Part 3. Paragraph 17 of Schedule 3 (nationality/immigration exception) further restricts relief in respect of immigration elements.
• On the discrimination merits, the court found material and relevant differences between Iraq and Afghanistan (security situation, ability to investigate and verify claims, availability of third‑country refuge routes) so the differential treatment was not direct discrimination; the common law like‑cases argument was a Wednesbury challenge and failed.
• On the PSED, the court held that the defendants should have had due regard to section 149(1)(b) and (c) in formulating the Afghan Scheme. An equality analysis was carried out only after litigation commenced. Given the practical consequences of quashing the scheme and the adequacy of the post‑hoc analysis, the appropriate remedy was a declaration that the PSED (section 149(1)(b) and (c)) was not complied with, not quashing or mandatory relief.

Other notes: anonymity was granted for the second claimant who remains in Afghanistan. The court emphasised the limited scope of its decision and did not grant more intrusive remedies in light of the practical impact on beneficiaries of the scheme.

The claim succeeded in part. The court held that the discrimination provisions relied upon (section 39(2) and section 29(6) of the Equality Act 2010) did not have territorial reach to include the claimants' employment in Afghanistan, so the substantive discrimination claims failed; the common law like‑cases challenge failed; however the defendants breached the Public Sector Equality Duty by failing to have due regard to section 149(1)(b) and (c) when formulating the Afghan Scheme. The appropriate remedy was a declaration of that failure rather than quashing or mandatory relief.